Calliditas Therapeutics AB (publ) (STO:CALTX) About To Shift From Loss To Profit

We feel now is a pretty good time to analyse Calliditas Therapeutics AB (publ)'s (STO:CALTX) business as it appears the company may be on the cusp of a considerable accomplishment. Calliditas Therapeutics AB (publ), a commercial-stage specialty pharmaceutical company, focused on identifying, developing, and commercializing pharmaceuticals products for treatments in orphan indications with initial focus on renal and hepatic diseases. The kr5.5b market-cap company announced a latest loss of kr466m on 31 December 2023 for its most recent financial year result. The most pressing concern for investors is Calliditas Therapeutics' path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Calliditas Therapeutics

Calliditas Therapeutics is bordering on breakeven, according to the 9 Swedish Pharmaceuticals analysts. They expect the company to post a final loss in 2023, before turning a profit of kr165m in 2024. So, the company is predicted to breakeven approximately 12 months from now or less. At what rate will the company have to grow in order to realise the consensus estimates forecasting breakeven in under 12 months? Using a line of best fit, we calculated an average annual growth rate of 48%, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Calliditas Therapeutics given that this is a high-level summary, however, take into account that generally pharmaceuticals, depending on the stage of product development, have irregular periods of cash flow. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

One thing we would like to bring into light with Calliditas Therapeutics is its debt-to-equity ratio of over 2x. Typically, debt shouldn’t exceed 40% of your equity, and the company has considerably exceeded this. Note that a higher debt obligation increases the risk in investing in the loss-making company.

Next Steps:

There are too many aspects of Calliditas Therapeutics to cover in one brief article, but the key fundamentals for the company can all be found in one place – Calliditas Therapeutics' company page on Simply Wall St. We've also put together a list of key factors you should further examine:

1. Valuation: What is Calliditas Therapeutics worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Calliditas Therapeutics is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Calliditas Therapeutics’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.